VANCOUVER, B.C.- Natural gas engine manufacturer Westport Innovations Inc. announced its earnings for the final quarter of 2014 and showed it trimmed financial losses for the year even as revenue declined. 

The company reported a net loss of $64.9 million in the final quarter, which is an improvement of 27 percent compared to the same time a year earlier. Revenues during the fourth quarter fell to 27.4 million, 48 percent lower than Q4 2013.

Westport posted a 2014 net loss of $149.6 million, 19 percent less compared to 2013.

In a release, the company noted total revenue exceeded $1-billion annually for the first time, what it called “a significant milestone for both Westport and the natural gas engine and vehicle industry.” Westport said the improvement in net loss for the quarter and for all of 2014 was primarily due to increases in consolidated gross margin and joint ventures’ income, combined with a reduction in operational expenses.

“Despite volatile energy markets in 2014, market interest in alternative fuels continues to grow in many parts of the world,” said David Demers, CEO of Westport. “Achieving over $1 billion in sales in 2014 highlights the dramatic growth in our market presence and prospects going forward.”

During the fourth quarter, in North America, a joint venture with the engine maker Cummins, known as Cummins Westport, saw unit volume increase by 28 percent year-over-year, driven primarily by strong growth in trucking and bus applications, which are up 41-and-40 percent, respectively, over the same period in 2013.

As the end of 2014, Westport reported cash, cash equivalents, and short-term investment balance was $94 million. It said its primary motivation is to get the company to breakeven from a cash flow stance as soon as possible.

2015 outlook

“With continued uncertainty in global energy markets, and due to fluctuations in exchange rates, 2015 topline revenue forecasts are quite uncertain today,” Westport claims.

But even so, the company expects modest growth and total segments revenue of about $1.1-billion.

Westport expects CWI to have modest revenue growth year-over-year due to the current energy prices; however the net income to Westport in fiscal year 2015 would improve as a result of identifying and resolving warranty issues associated with the Cummins Westport 8.9L ISL G.

Revenue from Westport Operations is expected to be between $110 million and $125 million, primarily due to currency fluctuations, volatility in US gasoline prices and continued economic uncertainty in Europe, offset by opportunities in new markets. 

Here’s what will affect the revenue outlook for 2015:

• The impact of foreign currency translation from Euro to U.S. dollar equivalent;
• Sales of Westport’s Ford QVM products are affected by customer expectations around gasoline fuel pricing, offset by continued commitment by larger fleets;
• Geopolitical uncertainty in key growth markets;
• Sales of new products including Westport iCE PACK dependent on the growth of LNG infrastructure, particularly advanced “cold” LNG stations.